The overall objective of this study is to ascertain and potential of the producer cooperative mode of enterprise for increasing employment and working conditions in metropolitan areas. Major factors that detract from the mental health of metropolitan populations appear to include the lack of jobs and the adverse nature of working conditions. Producer cooperatives will be examined in this study as a potential vehicle for retaining urban employment through the transfer of firms (that might otherwise have closed) to their employees as producer cooperatives and the creation of new jobs through the formation of producer cooperatives in areas of expanding market demand by groups of residents who face high unemployment rates. The quality of working life in producer cooperatives will be compared with that of comparable enterprises, and favorable aspects of the working environment of cooperatives will be examined in order to ascertain the degree to which they might be transferred to urban public bureaucracies. Finally, the policy consequences of producer cooperatives in the urban setting will be explored for their employment and work satisfaction impacts as well as the various forms of government assistance that might be drawn upon to utilize the potential of producer cooperative for improving the mental welfare of metropolitan populations.